Oil, Gas Boom To Create 3.5 Million Jobs By 2035, Industry Report Claims

fracking new jobs

By Roberta Rampton


The U.S. oil and gas boom is cutting into jobless numbers, supporting a total of 1.7 million jobs this year, a number that will swell to almost 3 million by 2020, a leading consultant said in a study released on Tuesday.

The report by forecaster IHS Global Insight is part of a series attempting to quantify the impact that booming production of so-called "unconventional" oil and gas has had on the American economy.

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Using new technology to blast fossil fuels trapped in shale rock has transformed the U.S. energy sector.

After five years of rapid growth, unconventional oil accounts for about 2 million barrels per day of U.S. production in 2012, IHS said. Total U.S. crude oil production is expected to average 6.3 million barrels per day, according to the Energy Information Administration.

Unconventional oil will outpace conventionally drilled oil by 2015 and reach close to 4.5 million barrels per day by 2020, representing close to two-thirds of total U.S. crude and condensate production, IHS said.

"At which point do you stop calling this unconventional?" said John Larson, a vice president at the firm and lead author of the study, in an interview.

"This is going to become the convention."

Oil, gas and chemical lobby groups helped pay for the study but did not influence its independent, data-driven results, Larson said.

More: Is Fracking A Solution To The Jobs Crisis? Separating Facts From Spin


Obama Cited Earlier Report

President Barack Obama cited an earlier report in the IHS series on the campaign trail and in a State of the Union address that documented 600,000 jobs created by the natural gas sector.

That natural gas employment estimate has since swelled to 900,000 jobs, Larson said, noting more data is now available about new "plays" where companies are drilling.

By 2020, IHS forecasts about 1.3 million additional jobs in unconventional oil and gas, with the sector contributing more than $416 billion to the economy.

Of the 3 million total jobs, IHS said about 20 percent would come directly from the upstream oil and gas industry, with more than 900,000 people employed by suppliers and about 1.5 million "induced" jobs from spending by workers in the sector.

With 12 million Americans unemployed and about 23 million underemployed, the growth in unconventional oil and gas jobs is helping take some slack out of the jobs market, Larson said.

"This is really overwhelmingly net new jobs being added to the economy," he said.


Big Policy Decisions Ahead

The report comes as the Environmental Protection Agency considers what role it should play in regulating hydraulic fracturing or "fracking," the technology used by drillers to blast sand, water and chemicals into shale rock to unleash the oil and gas.

Environmental groups have raised concerns that fracking can pollute groundwater and air, but the industry says the practice is safe so long as wells are properly built.

The projections in the report assume the industry remains regulated mainly at the state level, and also assumes that most growth in drilling continues to happen on privately owned land, Larson said.

The sector currently contributes more than $61 billion in revenues to government, rising to more than $111 billion by 2020, assuming no changes to the industry's tax incentives.

However, both Obama and Republican presidential candidate Mitt Romney have talked about rolling back those tax breaks as U.S. policy makers look for ways to boost revenues to help avert massive spending cuts and personal income tax increases that are part of the "fiscal cliff" looming at the end of the year.

In February, IHS is planning another report in the series looking at how the energy boom has led to a "renaissance" in the U.S. manufacturing sector.

Part of that report will forecast jobs created by proposed exports of liquefied natural gas, Larson said.

IHS currently assumes exports of 4 billion to 6 billion cubic feet per day by 2035, Larson said -- far less than what companies have proposed to build.

Even if the Energy Department gives a green light for exports, IHS does not believe the global market is strong enough to support all the proposals, Larson said.

"It's really hard for us to see how all those (terminals), even if they were approved, end up being built," he said.

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44 Comments

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ticknert2

Funny how we got into this position with President Obama blocking exploration and production ay CONs?

October 30 2012 at 10:13 PM Report abuse +1 rate up rate down Reply
1 reply to ticknert2's comment
talari

I think it all depends on which liar you want to believe.

October 31 2012 at 1:20 AM Report abuse rate up rate down Reply
tuco60

You gotta love republicans. They get all preachy about not passing debt on to their grandchildren but they're perfectly willing to pass a destroyed planet on to them, just so long as they can keep burning the oil and not have to make any sacrifices to save the atmosphere. Nobody ever said a republican had any common sense. 450 ppm is coming faster and faster. Nobody seems to care just yet but they sure will when it happens. All this stuff to get more oil will just get us to 450 ppm that much faster. Kiss your grandchildren goodbye-you're killing them every day.

October 30 2012 at 9:37 PM Report abuse rate up rate down Reply
CaptainWhat

And if we allowed all manufacturers to ignore ALL safe product regualtions that prevent faulty/poorly made prducts from injuring/maiming/killing people every year, there'd be more jobs too. But what happens WHEN/not IF, just check history of of oil companies) the big spill, water table/aquafier destruction hits due to fracking like crazy. I mean it's not like they can pay enough $ in reparations for lost homes, jobs, agricultur products, and finding a new water supply for millions of people driven out/doomed by a couple major fracking incidents. Those are IRREPEARBLE. They can't be fixed. ANd all it does is posthone the inevitability of running out by 50-100 years and NO WAY wil the prices of the products be CHEAPER! NEVER HAPPEN. EVER!

October 30 2012 at 8:32 PM Report abuse -1 rate up rate down Reply
fa1thful1

Romney must have paid rupert murdoch+the MSM media off. Propaganda to the hilt.President Obama is awesome. Hoep the repunk party is extinct after this election. Bunch of money hoarding people hurting oligarchs that look,smell and act like rotton dinosaurs..no wonder they like dinsaur slime oil!

October 30 2012 at 6:42 PM Report abuse -1 rate up rate down Reply
Dan Crabtree

Oh no over a trillion jobs will be created as soon as barrack is reelected once again..democrat theology..

October 30 2012 at 5:48 PM Report abuse +1 rate up rate down Reply
howlar2

Only if Obama loses, which looks highly likely

October 30 2012 at 4:56 PM Report abuse +1 rate up rate down Reply
1 reply to howlar2's comment
ticknert2

and then you woke up....

October 30 2012 at 10:12 PM Report abuse -1 rate up rate down Reply
dlsbasscop

Who will do the Best Job for OIL and COAL?? Romney full speed ahead and it will add Jobs, Jobs and more Jobs. Obama's Record is Killed the Keystone Pipeline, Stopped off shore drilling so much the big rigs went to Brasil, Lower record of permits given for FEDERAL LAND, and Obama Stated "anyone who wants to start a coal plant can, but they'll go bankrupt". Obama is saying Trust Me. The dead American's trusted Obama as Commander in Chief, and were left to die in Lybia. Romney 2012 for Jobs, Better Judges, and a Secure America with a strong military.

October 30 2012 at 1:41 PM Report abuse -1 rate up rate down Reply
HonknDodge

WOW, over the next 23 years, what a deal.

October 30 2012 at 9:48 AM Report abuse +2 rate up rate down Reply
cazsue

Ask anyone who lived this nightmare - their communities have been permanently destroyed for the greed of a few.

October 30 2012 at 9:47 AM Report abuse +2 rate up rate down Reply
1 reply to cazsue's comment
whiteoak

ARE YOU ARE A PROPERTY OWNER ????????

October 30 2012 at 12:17 PM Report abuse rate up rate down Reply
sarge617

Tell you what, how's about they drill in YOUR backyards for this gas! We threw these hydro frakkers OUT of ERIE County, PA. We have a tremendous amount of agriculture here, and if you want your kids drinking Kool Aid made from the polluted water that this industry brings with it, and eating produce and livestock grown on that polluted soil, have at it friends. Money is NOT everything. Not to burst your bubble, but all of that clean energy for america in under contract to CHINA, so when the gas is gone, and nothing is left but polutted water and soil, don't cry...PS: the jobs will be gone too.

October 30 2012 at 6:55 AM Report abuse +1 rate up rate down Reply

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